March 25, 1887.] 



8CIEN'CE. 



303 



non-material possessions as well as the tangible 

 utilities. A larger scope in the conception of cap- 

 ital IS, of course, the necessary corollary. The 

 ordinary analysis of capital is, furthermore, im- 

 proved by the division into ' specialized ' and ' non- 

 specialized,' depending upon the degree of diffi- 

 culty in diverting it from one trade to another ; 

 and convenience in phraseology is enhanced hy 

 distinguishing between • remunerator> ,' or ' wage- 

 capital,' and 'auxiliary capital,' or that employed 

 to aid the labor which the first supports. In such 

 a spirit of broad definition and logical distinction, 

 book i. of the ' Economics of industry' presents 

 the ordinary doctrines of land, labor, and capital 

 with clearness and conciseness. 



Book ii. treats of normal value. Here, with 

 most painstaking care, is elaborated the theory of 

 value and the solution of the problem of distribu- 

 tion which especially distinguishes the modern 

 economy. In the theory of value, the old lines 

 are generally followed, save in the more or less 

 important substitution of 'normal value ' for the 

 concept which has become familiar as ' natural 

 value.' The discussion of distribution, however, 

 reveals a departure from old standards at the very 

 outset. Instead of the ancient assignment of the 

 product of industry to the various classes of rent, 

 profits, and wages, we find a division into rent, 

 earnings, and interest. In accordance with a 

 principle that is characteristic of the new school, 

 the entrepreneur class is differentiated from the 

 capitalists, and its share of the produce is grouped 

 with the wages of labor rather than with the 

 wages of abstinence. The lavv fixing the rate of 

 interest is accordingly worked out as the sole de- 

 terminant of the capitalist's share of a product, 

 while the profits of the employer of labor are as- 

 similated in treatment to the income of skilled 

 wage-earners. The justice and logic of this ar- 

 rangement cannot be questioned. The industrial 

 revolution which began last century, and may 

 not yet have culminated, has certainly evolved a 

 new economical factor. As Walker says in his 

 work on wages, *' It is no longer true that a man 

 becomes an employer because he is a capitalist. 

 Men command capital because they have the 

 qualifications to profitably employ labor. To these 

 captains of industry (or organizers of industry), 

 capital and labor alike resort for the opportunity 

 to perform their several functions." The tendency 

 of this class to increased importance is well illus- 

 trated by the demonstration of the principle that 

 those who, with little or no capital, depend upon 

 their business profits for a livelihood, undersell 

 and drive out of trade those who, having capital, 

 undertake the management of industry merely to 

 increase their income (pp. 136, 137). Modern pro- 



duction has, in short, attained that stage where 

 ability without capital has a much fairer hope of 

 great rewards than capital without ability. It 

 would be useful to have this fact instilled into the 

 minds of the masses who are constantly com- 

 plaining about the ' capitalists.' The chapter en- 

 titled ' Earnings of management,' in the book un- 

 der i-eview, contains a most admirable investigation 

 of the nature and functions of the entrepreneur 

 class. 



It was to be expected that an author of modern 

 economic propensities would touch up that Mte 

 noir of the new school, the wages-fund theory. 

 We find this subject buried m the depths of the 

 chapter on trades-unions. The authors are rather 

 inclined to adopt the position of Mill in his later 

 days as opposed to the bald doctnne of the ex- 

 treme old school. Jevons and all the other lights 

 of the new school throw themselves unreservedly 

 upon the doctrine that wages and profits can in- 

 crease simultaneously ; in short, that the law of 

 supply and demand operating in the respective 

 classes determines wages of labor and wages of 

 management. The Marshalls appear unwilling to 

 go thus f^r ; but they emphasize the idea that the 

 efficiency of labor as well as the amount of ante- 

 cedent capital exercises a potent influence upon 

 wages. Trades-unions, they think, may enable 

 laborers to obtain a general increase of wages, 

 which, however, will only be permanent if at- 

 tained by means that do not seriously hinder pro- 

 duction, and if used in such a way as largely to 

 increase at least the personal capital of the labor- 

 ers, and so to add much to their efficiency (p. 203). 



The wealth of households. Danson. Oxford, Clarendon 

 pr. 12°. 



In striking contrast with the scientific spirit 

 that pervades the volume just discussed, is the air 

 of breezy popularity that characterizes ' The 

 wealth of households.' Why the author chose to 

 disguise a treatise on political economy with such 

 a title is an unsolved mystery. We hazard the 

 conjecture that the reason might be found in the 

 same trait of Mr. Danson's mind which has led 

 him to turn the customary order of economic dis- 

 cussion all topsy-turvy, while not aiming at any 

 novel result. His book was originally concocted 

 for the benefit of his children. This probably ex- 

 plains the division of the text into numbered par- 

 agraphs of an average length, that suggests a 

 second or possibly a third reader, and on a princi- 

 ple of logical connection that has no parallel out- 

 side of the authorized version of the Bible. 



The intimation in the preface is not necessary to 

 assure the reader that Mr. Danson has been a 

 ' man of business.' Nor is it difficult to guess the 

 special line he was in. The able, vigorous, and 



